The Fair Work Commission (FWC) has announced a 15% pay rise for aged care workers will take effect from 30 June this year. The FWC first recommended a 15% pay increase in November but had not decided on timing until yesterday. The pay rise has been approved on the grounds that current pay rates do not match the value of the work, which the FWC says is partly due to historical “gender-biased assumptions” about the importance of care work.
The Fair Work Commission is a legal tribunal with the power to set minimum wages and conditions for a range of sectors under the ‘award’ system. It has been jointly considering submissions from three different unions calling for a 25% pay increase in aged care. The Federal Government, which is the main funder of the aged care sector, supports the unions’ case.
In November, the FWC approved a 15% increase for the sector. There are a number of technical details that still need to be worked out before this is finalised, but yesterday’s decision means an ‘interim’ pay rise of 15% will take effect from 30 June while that process is worked through. It will apply to a broad range of aged care workers, including staff in residential facilities, home-based carers and aged care nurses.
The FWC concluded aged care pay does not match the value of the work for a number of reasons. Another reason is there has been a rise in patients being cared for in homes who have complex care needs such as cognitive impairment and extreme frailty. Another is the FWC’s view that “as a general proposition, work in feminised industries including care work has been historically undervalued and the reason for that undervaluation is likely to be gender-based”. The FWC said that the changing complexity of work and other factors would have been enough to justify an increase even if there was no evidence of gender-based undervaluing, but noted its decision would be “beneficial”. The FWC said it was “uncontroversial that a gender pay gap exists” and that gender undervaluation is a “driver”. “Women’s role as parents and carers and undertaking the majority of primary unpaid caring responsibilities… contributes to the invisibility and the under recognition of skills described as creative, nurturing, facilitating or caring skills in paid labour,” it concluded.
What happens next?
Employers will be required to implement the higher pay from 30 June. The FWC has set out the new rates of pay for different categories of workers. For example, a Level 1 Registered Nurse in aged care will go from $980 a week to $1,179 a week. As the Federal Government funds many aged care wages, it will need to approve more expenditure. Acknowledging the decision in an ABC radio interview this morning, Treasurer Jim Chalmers said the Government would “have to find room” in its Budget.